Sales of 100% mortgages hit a five-year high last year, an analysis of Financial Conduct Authority (FCA) data by Compare the Market has found. The comparison site warns the rise indicates buyers are increasingly struggling with affordability.
In the first three quarters of 2025 (January to September) sales of no-deposit mortgages reached 574, compared with just 135 in the whole of 2022. The numbers have risen steadily since, with Compare the Market’s Freedom of Information request revealing there were 248 of the 100% mortgages taken out in 2023, and 423 in 2024.
“The rise in zero-deposit mortgages is symptomatic of a market in which many buyers are finding it increasingly difficult to save, as rents, household bills and everyday costs continue to eat into disposable income,” said Charlie Evans, money expert at Compare the Market.
“First-time buyers are turning to 100% mortgage loans as a way onto the property ladder – particularly in regions like the North West and South West where demand was strongest last year. Greater product availability and lenders cautiously re-entering this space may also be playing a role.”
But Evans warns that buyers who choose the no-deposit mortgages could pay tens of thousands more in interest.
“While 100% mortgages can remove the upfront hurdle of a deposit, they often come with higher rates – and even a 5% deposit could help to save borrowers nearly £30,000 over the long term,” he said.
However, David Hollingworth, associate director at mortgage broker L&C, acknowledged saving for a deposit is not always feasible.
“Lenders have increasingly sought to address the challenges that first time buyers face,” he said. “Saving for a deposit is certainly not easy, especially alongside higher rents and cost of living.
“The increased availability of mortgages for those with a small or no deposit can help to boost the chance of buying more quickly.”